a federal judge has blocked the new overtime rule

by Alison Green on November 18, 2024

A federal judge in Texas has blocked a new rule that would have expanded access to overtime pay to millions more salaried workers.

And not only that — the court also struck down the increase that already took effect on July 1 of this year.

The background: In the U.S., all workers are classified as exempt or non-exempt. Non-exempt workers must be paid overtime (time and a half) for any hours over 40 they work in a single week. Exempt workers are exempt from overtime requirements. To be exempt, you must earn a certain dollar amount or higher and perform relatively high-level work as your primary duties. (There are some exceptions to this, including teachers, doctors, and lawyers, who are always exempt.)

On July 1, the salary level that makes you exempt from overtime pay increased to $43,888 — meaning that anyone making under that was due overtime pay (unless they were one of the exceptions named above). The threshold was set to increase again on January 1, to $58,656.

On Friday, a U.S. District judge ruled that the Labor Department exceeded its authority with the new rule.

So now, the previous threshold of $35,568 — which was set in 2019 — is set to go back into effect.

It’s not yet clear if the Labor Department will appeal the decision. If they do, it’s possible that an appeals court could quickly reverse this ruling … but if the appeal is still pending when the new administration takes over on January 20, they’re unlikely to continue that appeal. (Something similar happened in 2016, when a court halted a similar rule just days before the hike was supposed to take effect, and then permanently blocked it a few months later.)

Notably, the judge this time cited the U.S. Supreme Court’s decision earlier this year to throw out the Chevron doctrine, which for decades had required courts to defer to “permissible” agency interpretations of the statutes they administer, “even when a reviewing court reads the statute differently.”

So, two questions that a lot of employers now face:

  • If they raised your salary to meet the July 1 threshold of $43,888, are they going to leave it a the higher level or lower it back? Most probably won’t lower salaries because of the morale hit it would cause, but some might.
  • If they were planning to raise salaries to meet the January 1 bump to $58,656, will they reverse course or stick with those plans? If they had planned a bump but hadn’t announced it, they’ll probably quietly cancel it. If they had already announced they planned to bump salaries then, they’ll face employee pressure to stick with that.
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  2. Searching*

    If you meet both the earnings threshold and the duties test, but are paid on an hourly basis, you are still considered non-exempt, correct?

    2. Loose Socks*

      It depends on the specific industry, but you can definitely meet both requirements but remain as an hourly employee. This does not mean you aren’t full-time, it means you aren’t salary, so your check can change from pay day to pay day depending on the hours you work. If this is the case for you, then you would continue to earn overtime, unless your state has specific laws in place that say otherwise

  4. Cheap Ass Keto Bread*

    Can Texas just please go back to being its own country again and stop ruining things for the rest of us?

      1. Fluffy Fish*

        That response felt kinda rude. I believe they’re trying to make is if Texas was their own country then there would be no federal judge from Texas.

        1. hi*

          I hope you don’t mean that Maya is the one being rude. Comments like “oh can Texas/Florida/whoever just secede and leave us alone” are extremely dismissive of people who live in those states who also suffer from these decisions, likely even worse than those who live elsewhere.

          1. Fluffy Fish*

            I did in fact mean that Maya’s response felt rude. I understand your sentiment about being dismissive about the people who live in those states and it’s valuable to bring up. Also valid are peoples feelings and exasperation of decisions being made by judges and elected officials of certain states that broadly negatively others.

            But starting by questioning the OP’s intelligence is unnecessary.

            1. Maya*

              I questioned whether OP knew what a federal judge is. OP, meanwhile, was highly dismissive towards millions of people solely because of where we’re located. I suppose I could’ve sugar coated it, but as a many times marginalized person, I am tired of this.

              1. Peanut Hamper*

                Oddly, if Texas were a separate country, you could probably apply for political asylum to the United States.

                I’m sorry you are marginalized, and I hope you can come out in a better place soon.

          2. Throwaway Account*

            I’m in “one of those states,” and I’m all for my state seceding – we need to enter the “find out” phase. Average people are already being hurt, I want the people in charge to feel it too.

            1. Blue state subsidizing*

              As a person in a blue state I would love my taxes to stop heavily subsidizing red states — just for a little while — so maybe they can realize that if it weren’t for us, money for certain federal programs would be significantly less for them. It’s supposed to be united states, but I think a lot of people forget that.

      2. Dawn*

        I have to say that, watching from outside of the country, it is always bizarre how often the law in America is controlled by this or that judge just deciding to block it for the whole country.

        I don’t pretend to understand the purpose behind the system and maybe it has some real advantages! But it at least seems quite inefficient.

          1. Nobby Nobbs*

            In defense of inefficiency, sometimes it’s a feature and not a bug. Not here, obviously, but an inefficient government by its nature can pile a lot of red tape in front of anyone trying to overturn the whole shebang.

            1. Feeling Wobblie*

              And yet this overtime pay is overthrown. I’m not arguing with you, I’m just saying “funny how fast things work when people in power want them too.”

              1. Lisa*

                It is not permanently overthrown. The administration can appeal to a higher court, all the way up to the Supreme Court. But since Trump won and “supports workers” by opposing this sort of law in their favor, his administration would not continue the appeal.

                But the fact that the Supreme Court has overturned previously-settled law is really aggravating. It has been used in good cases, like Brown V Board of Education overturning Plessy V Ferguson, but both Roe and the Chevron doctrine strip away the rights of people, the one in favor of religious extremists and the other in favor of corporations. Which is maddening.

        3. ampersand*

          I live here and I don’t understand it. It seems like a recent occurrence that states are like: we’re going to block (insert new federal law)! I’m sure it’s just that it’s become common and egregious enough that I’m just now really noticing it, but I also don’t remember that this used to be such an issue. (We also didn’t used to be so divided…)

        4. Kevin Sours*

          It’s complicated. The idea is “what do we do in the meantime when there is a dispute and it’s going to take literal years to resolve”? The idea is that in some cases you can “put a hold” on changes for a time while the dispute is heard. That’s where we are. There are supposed to be rules regarding when and how this is done to limit the sweeping scope of things but the 5th Circuit and even SCOTUS have increasingly ignored them when they find it convenient and the system is breaking down (in the 5th circuit there is a strong pattern of ignoring the rules when the ruling would favor Republican policy but interpreting them extremely strictly when the outcome would favor Democratic policy — its very strongly outcome driven).

          If you hear the term “Shadow Docket” it refers to a bunch of these sorts of decisions that are largely based on something other than the merits of the dispute, don’t have as many guardrails in place (in part because they are supposed to be short term measures), but can be abused to affect outcomes while deflecting responsibility from the people doing it.

      3. Kevin Sours*

        The 5th Circuit covers Texas, Mississippi, and Louisiana but is dominated by Texas. It’s entirely lawless due to a number of Republican appointees making things up to push outcomes favorable to Republican policy. This is made worse by the fact that due to the structuring of the courts making it entirely possible to get a particular judge by filing suit in specific locations. These judges tend to be the most lawless. So people go shopping for these judges to get national level policy overturned.

        The federal court administration implemented some reforms to address this judge shopping but it wasn’t mandatory so the 5th just ignored it.

    2. QED*

      I’m not totally sure which Texas judge blocked the rule, but due to quirks about how Texas assigns cases within its federal districts, certain litigants will file there in order to have friendlier judges: https://news.bloomberglaw.com/us-law-week/shopping-for-the-judge-you-want-honed-to-perfection-in-texas.

      Congress introduced a bill to fix it, and then Texas said it wouldn’t change the practice regardless. So this is a Texas issue but also it is federal court.

    3. beautiful, talented, brilliant, powerful musk-ox*

      As a Texan, I agree we keep ruining everything but also like…nearly half of the people who live here would agree as well. We’re not a monolith. In fact, our most populous cities are almost always left-leaning in elections. We mainly suffer from having excessively loud and obnoxious politicians in place and the Super Texans who also want to go back to being our own country, who are often equally loud and obnoxious.

      Like, I get it; I want to move despite the fact that I’ve lived here my entire life. But there’s a whole lot of people who live here who will also find this ruling absurd.

      1. bleh*

        Floridians who aren’t that way agree. It’s a beautiful place with lots a lovely humans and even lovelier animals. However, I get that the politics are disgusting.

      3. The Kulprit*

        I’m sorry that you feel like you’re getting pushed out of your home, that must be very painful.

        1. Sacred Ground*

          You’re close but you’ve got the order wrong: Texas was first part of Mexico, then it seceded and was independent for a decade before it voted to be annexed by the US. This was the start of the US-Mexico War.

          East Texas had previously been taken over by US southerners who basically just moved in, established new cotton plantations, claiming the land and daring anyone to remove them. When Mexico banned slavery, these new Texans seceded from Mexico to create a new republic rather than give up their slaves.

      3. Kevin Sours*

        We stole it. But not exactly from Mexico (they hadn’t really finished stealing it from the natives before the American settlers moved in)

    5. Annoyed*

      Well, first, no, we can’t. We cannot secede from the Union, although we could break up into 5 smaller states.

      Would that help? No. We’re still going to be covered by the 5th Circuit

  5. Harrowhark*

    I’m wondering about employers who, instead of raising salaries, simply made their salaried workers into hourly workers. As someone below the July 1 threshold, it was annoying to lose the perks of being salaried when my employer switched me to hourly pay, and it would be frustrating if I now lose overtime protections as well.

    1. Ask a Manager* Post author

      If your paycheck fluctuates by the number of hours you work, then by definition you are required to receive overtime pay when you work more than 40 hours in a week.

    2. Banana Pyjamas*

      You still could. They want to change the threshold for over time from 40 hours per week to 160 hours per month. This would devastate our family. I don’t think my husband’s employer is likely to cut his hours to avoid EOM overtime, but we wouldn’t be able to pay our bills that are due the first half of the month.

  6. CatCalendarFTW*

    just to clarify “If a company had already announced they planned to bump salaries, they’ll face employee pressure not to.”

    is the idea here that employees would not want a pay bump because they prefer overtime they would get (despite lower base pay) ?

    2. Vincaminor*

      The unspoken part of that sentence is “they’ll face employee pressure not to [cancel a pay raise they already announced]”, I think.

  7. Ann Nonymous*

    It’s astounding how the majority of our citizens continually vote against their own interests. Disgusting.

    2. KB*

      Indeed. I see political signs outside a dwelling that is clearly not the residence of a billionaire and think “WTF!”

      1. Tech Industry Refugee*

        They will suffer as much as the rest of us, I think bitterly to myself. There has to be a German word for that specific feeling…

        1. Lab Rabbit.*

          The problem is that their blame will be completely misplaced. And so the cycle repeats and the change they so desperately needs will never happen.

        2. Veruca Salt*

          The closest I could find is “Selbstzerstörerische Schadenfreude,” which translates as “self-destructive schadenfreude.”

        3. amoeba*

          I mean, we do have the somewhat fitting “Neidkultur” (envy culture) – which basically just means you don’t like anybody else to have anything nice.
          (Unfortunately, also a typical thing for Germans, not just Americans!)

    3. BellaStella*

      I was just having this conversation with a friend in Washington State. Agree, it is difficult to understand.

    4. Lemons*

      Since it’s not the focus of this blog I’ll be brief (delete this if it’s inappropes, Alison), but I’ve been thinking all morning about single-issue voters, because I think those are the ones who tend to vote against their own interests, on any side. It is understandable that people do this, because those single issues are purposefully presented as huge moral or existential threats. It’s razzle dazzle to distract from less exciting issues the same voters would care a lot about if they weren’t being continually refocused on the single issue things.

      1. Lab Rabbit.*

        Yes, exactly. And they don’t mind what they perceive as a little harm to themselves if it means that some group they don’t like receives a much greater harm.

        It’s sad, so sad. This is why the good aliens don’t visit us. We are so backward and divided.

    5. Turquoisecow*

      It’s because misinformation runs rampant and people often don’t understand what they’re voting for and what the implications of that will truly be. Politicians often have no incentive to explain it, or if they do it’s merely seen as propaganda against the other side, and journalists/the media have really fallen down on the job as far as holding politicians accountable for that stuff, like asking, “but (candidate), what about (implications you haven’t mentioned in your statement supporting this issue)?”

    6. goddessoftransitory*

      Being cruel to others makes them feel powerful, and that illusion of power makes them feel safe.

      In reality, they have neither power nor safety, but they don’t care until the leopards target their specific faces.

      1. Elizabeth West*

        I cut someone off over it. I also unfriended a couple of people.
        I could see how some folks might have been fooled the first time, but this time it was utterly blatant and still that was not a deal breaker for them. Buh-bye.

  8. Greg Joughin*

    TBH, I expected Kacsmaryk. The Trumpiest of Trumpian judges; and also, as the only federal judge in the Amarillo Division of the Northern District, the judge-shoppingiest.

  9. Relieved*

    I’m torn on this one and have been from the start. On the one hand, I absolutely abhor the kinds of places abusing their staff with the low thresholds (the quintessential – but not unique – example being hospitality, making some young kid a “manager” at the lowest possible pay, then working them 80 hours a week for no additional compensation).

    On the other hand, I work in a non-profit organization that provides services 7 days a week; there is no more money for either pay raises or overtime. I can’t just wave my magic corporate money wand to jump staff from $45k to $60k. At the current threshold, if Saturday staff calls in sick and someone covers it, they take off the next Monday instead. That means one week they’re at 48 hours and the next week they’re at 32, but they’re salaried, so they get the same pay check for each week. At the new thresholds, it would mean we’d just have to close on those Saturdays in that scenario (or I, as the director and the only one still exempt works all of them).

    I’d love the new overtime rule if it were based on a biweekly period instead of a weekly one, just to allow for the fluctuation. Make it 80 hours in 2 weeks and not 40 in 1 and I’m sold. (The weekly thing also means my staff can’t work a 5-4/9 schedule, unlike our government counterparts.)

    1. Starbuck*

      I too work at a non-profit and no matter how important the mission, the answer to resource shortages shouldn’t be exploiting workers. I started out years ago as salaried when the threshold was much lower, and my life is SO MUCH BETTER now that the threshold has kept increasing in my state. Absolutely no thank you to a biweekly period. If I have to work extra one week, I’m going to be tired and miss my grocery run and order extra take out THAT WEEK so yes I do need overtime pay to compensate for that. Having an extra day off the next week doesn’t completely make up for that.

      Unfortunately it sounds like your non-profit has already chosen to exploit workers instead of doing less because you can’t afford the current level of services.

      2. Friendly Neighborhood Curmudgeon*

        Saying that their non-profit “has already chosen to exploit workers” because they don’t meet the threshold or can’t afford overtime is not accurate in all situations. In many parts of the country, including where I live, $40-$50k is a good wage, particularly in the non-profit/government sector.

        1. Starbuck*

          They said they also can’t afford raises, and are already making people work unpaid overtime. How is that not exploitation? I’m assuming that they’re not just talking about the idea of future raises, but have also not been giving appropriate raises in the past either.

    2. doreen*

      The weekly thing doesn’t necessarily keep your staff from working a 5-4/9 schedule – non-government workers can work that schedule by having an unusual workweek , where for example, the first 4 hours of Friday are in one payweek and the last 4 are in a second. So you have 4 9 hour days in the first week plus 4 hours on the 5th day for a total of 40 hours. Then the second week , you have the last 4 hours on Friday plus four 8 hour days for a total of 40 hours.

    3. AnonJustInCase*

      The answer to staffing issues shouldn’t be abuse of your workers.

      If you can’t pay a living wage to your lower paid employees, maybe you need to rethink the wages you pay your highest paid team. Or rethink those open hours…but not paying your team a reasonable wage shouldn’t be because it creates issues with the operation.

      1. anonymous anteater*

        Or, zooming out one step further, evaluate whether it is sustainable to provide the services that you do. It must be heartbreaking to consider scaling back or shuttering services that you know people depend on, but the question is if you are able to provide them in compliance with labor and other applicable law. And the answer might be no. In an abstract way, this is no different from other hidden costs, such as emissions, horrible exploitation or pollution in producing, far-away countries. Usually you can’t get away with those to the same extent when you produce domestic, and it’s reflected in the price tag.
        I know it’s not abstract for you!

    4. Jessica T.*

      A productive suggestion: A way to mitigate the problem you describe is to change the official start day of your “week” in payroll. A week does not need to be Monday-Sunday. It sounds like weekend coverage is the time that is most likely to cause inadvertent OT.

      I’d recommend making your work week Saturday – Friday. That way, if someone unexpectedly fills in on Saturday or Sunday, you have the rest of M-F to sort out reschedules for them to get time off and minimize OT hits — and for you and the director to be more available to backup, if needed. (This is our schedule to deal with occasional weekend work, where I know staff benefit more from R&R after a weekend of working.) Talk to whoever does payroll for you. There will probably be a week where payroll is a slightly larger pain in the ass as you change the schedule, but that’s a one-time pain for a long-term solution.

      1. Starbuck*

        Yeah, if they have the ability for someone to only work 32 hours in one week after having worked 40+ to cover someone in a previous week, they should be able to make this work at least part of the time. Because what’s the coverage for that person’s 32 week with the day they’re missing?

  10. SummitSkein*

    As devastating as the overturn of Roe was, Chevron was -terrifying- and yet slipped by so many people’s radars. We’re only just beginning to see the potential effects.

    1. Dasein9 (he/him)*

      Yep. Chipping away at labor protections is linked to the chipping away of rights to bodily autonomy is linked to the criminalization of undocumented status in some really scary ways.

      1. BellaStella*

        Bingo. Millions of workers (up to 5million I have read in news articles) are affected by this. Linked to rolling back of worker protections, bodily autonomy, health care and education, there are some dark times that could be coming. It really scares me. An uneducated, unprotected, unhealthy working class is very easy to control.

    2. Pastor Petty Labelle*

      Roe was obvious about how it affected people directly.

      Chevron was just seen as this legal thing that didn’t seem to matter day to day. Because under Chevron the rules got made and implemented without a lot of fanfare. Oh, all milk must be pasteurized, okay. Then no one notices that people aren’t getting sick from drinking bacteria filled milk anymore. Chevron was negative space.

      1. Jessica*

        yes, much like vaccines. things that when new were hard won, wonderful advances that stopped tragic conditions of the past, are now taken for granted because they’re working.

    3. Kali*

      Yes. I was angry but unsurprised by the overturning of Roe. Chevron (and Lemon) getting overturned scared me significantly more because of how insidious the effects will be. Collectively, we won’t realize it until we’re knee-deep.

      1. SummitSkein*

        THIS. The “collectively, we won’t realize it until we’re knee-deep.” And those of us that realize it before are shouting into a void trying to get people to care. It’s scary.

        1. Bee*

          Much like how no one notices the problems with industry regulations being rolled back until suddenly there’s a massive new grocery recall every week and doors are falling off planes mid-air.

  11. Sharks Are Cool*

    At least now I don’t have to worry about switching to the bi-weekly hourly pay schedule from my bi-monthly salary. I don’t know whether anyone at my employer was even aware of the upcoming January bump before I mentioned it to my boss last month (my salary is about 10K+ lower than the expected 2025 threshold), and I hadn’t gotten an answer yet about what they intend to do. I’m professional staff in higher ed so the chances of them raising my salary seemed pretty low, especially since I never work overtime, but the bi-weekly pay schedule for hourly employees would feel like losing money every month with an occasionally windfall.

    1. Starbuck*

      Is that just a quirk of how your workplace handles it? Because you can totally be hourly and still paid bi-monthly. The pay period doesn’t have to change.

      1. Sharks Are Cool*

        This is something my boss was trying to get an answer for! If I could stay bi-monthly and get paid overtime in the (incredibly unlikely) event my hours exceed 40, great! But if the only way for the university to track my hours is to add me to the hourly-timecard-submitted-every-two-weeks system, then it feels like I’m losing money monthly even if my pay remains the same overall. Hourly staff also start out earning less vacation time than salaried, although I’ve been here long enough that it wouldn’t make a difference.

        1. Lurker*

          Maybe try to frame thinking about bi-weekly pay like this: there will be two months out of the year (assuming you’re paid year round and not only during the fall/spring semesters) where you will get paid three times instead of two. I love those months…it feels like an extra paycheck!

          1. Sharks Are Cool*

            Sure–unless you rely on both bimonthly paychecks at their current amount to meet basic needs and pay bills. Receiving less per month on short notice while waiting for a windfall would have been a significant hardship.

            Getting bumped up above the 58k threshold would have been life-changing. I’ve just been burned often enough by my current employer that I wasn’t holding out a lot of hope!

  12. The Wizard Rincewind*

    Interesting. The new threshold would have put me in the “you MUST pay overtime” bracket, and I was wondering what my small nonprofit would do, as we get comp time instead of time-and-a-half on the rare times we’re required to work more than 40 hours a week. There’s no way they could have afforded to bump my (and everyone else in a similar pay band’s) pay up to the new threshold, so I doubt that was on the table.

    Leadership also just set the budget for our new fiscal year, so the new budget probably did take this change into account. I have no leadership ambitions, but just this once, I’d like to be a fly on the wall for the meetings.

  13. Stuart Foote*

    I don’t understand why Congress can’t just pass a law updating the rule? I tend to think the amount should be higher, but I do see the issue with agencies just making whatever rules they want. I see a bigger issue though with courts striking down whatever laws they want though (and while Democrats don’t like to admit, their courts do it too).

    1. Berin*

      Congress can’t even pass a budget. Additionally, the party that currently controls the House (and in January will control the Senate and the presidency as well) are not fans of this rule.

    2. Starbuck*

      “I don’t understand why Congress can’t just pass a law”

      Well there’s the whole problem, lol. I can’t imagine something this worker-friendly getting passed, can you?

    3. Pastor Petty Labelle*

      Chevron gave deference to the agenices as allegedly they were the authorities on any subject since they deal with it every day. 400 odd Congress Critters who have to be elected 2 years plus 100 senators who 1/3 are elected every 2 years who come from a variety of backgrounds don’t have the expertise to know which rules are even needed.

      Also if Congress had to pass a law on everything that needed a rule, there would be gridlock. There just aren’t enough days in the year, even if Congress took no days off, to reasonably consider every rule every agency needs. That’s why Congress passed the enabling law – agencies can make rules. Which Chevron said the courts will defer to those rules as being presumed to be reasonably considered by experts. Which means the deference is gone and the court has to consider every rule as if just some joe schmo came up with it. So instead of gridlock in congress, our already overburdened courts will be burdened with cases arguing over rules.

      1. Gatomon*

        This – congress is laughably dysfunctional in the modern era and, even best case scenario, wasn’t intended to move fast on anything. They really only have expertise in getting elected and re-elected. I doubt they care about overtime considering the vast majority of them are either wealthy or on the take in some way, legal or not.

        I also think the rulemaking process is a little more transparent. Congress *can* slam a bill through if they want to, using various tricks, but there’s no way for us to comment other than contacting our representatives, which (personally) feels like shouting into a void when they’re not in alignment with my views. The bills congress creates often have all sorts of wild or unrelated amendments for people’s pet issues, or to curry votes, or to create an issue to hammer someone with in the next election.

        As I understand it, the proposed rules get published and we (the public) get a set length of time to review and comment before a final decision is made by the agency, which has to review those comments and justify their decision.

        I wonder if we should just jettison congress entirely and make the agencies a co-equal branch outside of the executive with more accountability to the electorate. Needs a lot more thought, but why reinvent the wheel when you have an effective process already….

      2. Engineery*

        I’m a technical expert on certain government rulemaking committees, so I’m part of the process whereby experts in the field are solicited to participate in the writing of new regulations. While participation in these committee meetings is limited to vetted contributors, all agendas, minutes, and communications are subject to FOIA and posted publicly as a matter of agency policy.

        Once we’re all happy with the proposed regulation (or at least, no longer objecting!) the Federal Agency prepares a Notice of Proposed Rulemaking and it goes out for public comment. You can then read the proposed regulation, look up all the meeting notes and stages of the proposed draft to see the process by which the regulation was written, etc. I believe you get 60 days to make comments and another 30 days for follow-up comments.

        Much like we did in 2017-2021, we are all soon to learn all sorts of mechanics about how the US government functions, or used to function.

    4. Forrest Rhodes*

      Congress pass a law? That would require agreement, and the current Congress can’t agree on what day of the week it is!

      1. Elizabeth West*

        I wrote a joke in TUNERVILLE where a ghost character asks incredulously, about an (actually good) law, “People called Congress, and they listened?!” That’s how you know the book is a fantasy. Not that a ghost asked the question, but that Congress actually did something good that people asked them to do, lol.

        (Fun fact, that book came out on January 6, 2020. Worst first book-iversary ever.)

  14. anon24*

    “Let the states decide…”

    For the rest of us of course.

    Yes. I know it’s a federal judge. But when is it not a federal judge in Texas fucking everything up.

    1. Wakeen get off the toilet!*

      “But when is it not a federal judge in Texas fucking everything up.”

      When it’s a federal judge in Florida fucking everything up.

  15. WarblerB*

    It’s my understanding that those who work at non-profits, and are non-exempt, are frequently asked to accept comp time instead of overtime pay. Is that correct?

    1. Ask a Manager* Post author

      There’s no exception to the law for nonprofits; they are required to pay overtime for non-exempt workers like other employers and cannot pay in comp time (unless it’s comp time within the same work week).

      1. Rusty Shackelford*

        What about state/federal government employees, since they seem to be exempt from many such laws?

        1. doreen*

          Government employees can be given comp time under certain conditions. One of the conditions is there must be a collective bargaining agreement to allow comp time or it must be agreed upon by the employee and employer before the work is done. The employer can’t do it unilaterally.

          1. OT first*

            Exactly. When I worked for a Smithsonian museum I barely made enough money to make ends meet, but I could get comp time!/sarcasm I kept saying “comp time doesn’t pay my rent.” Imagine my rage, then, when after two years of comp time, I found out that, by law, I was supposed to have been getting paid overtime as the first option, unless I specifically requested comp time. After that, when I was expected to work what would be OT and would specifically say I wanted OT, my department never needed me to help. Then I was told I wasn’t a team player because I never worked overtime. So shady.

  16. BellaStella*

    Does anyone here have something positive to share on this day? I think this is so sad for so many working people in the USA.

  17. HonorBox*

    At my workplace, we moved some salaried individuals to hourly. We try to adhere to the 40 hour per week schedule (for a variety of reasons) but do recognize that from time to time overtime will be necessary, and paid. We did so looking at the January 1 salary level because we’re on a July – June fiscal.

    For the group: My boss has already asked what we should do. I suggested we wait until we know whether this is appealed and what the outcome of that is. I’m going to continue to suggest that we have people paid as hourly employees, though having had to just go in and approve time cards, I could see benefit to moving back to salaried positions. If you’ve made a change to timekeeping, are you going to go back?

  18. Muffy*

    On the one hand I’ve always believed that having a salary threshold for overtime exemption plus the work type was the right way to go, compared to many provinces in Canada which just have work type exemptions (meaning if you are called a manager then you are “exempt” even if you earn 35k – it’s created a lot of fake managers) Howvwe the current threshold in the US of 35k is way too low. I believe there is one Canadian jurisdiction that combines the two (Manitoba I think) but the salary must be at least twice the average hourly rate (if you’re on salary you’re instructed to divide it by average hours of work per week to determine the applicable hourly rate). It makes it so that it’s about 89k as the threshold for no overtime. There are further exemptions to professions in every province that are separated from role and salary level – such as accountants, doctors, lawyers, engineers, IT professionals involved in specific IT roles, basically anything with a professional regulating body.

  19. George*

    This new law makes it harder to get salaried entry-level jobs. Most exempt employees are passed the new threshold already, and the ones that aren’t can’t meet the threshold. I’m in favor of not increasing the exempt threshold so that it is not difficult to get entry-level exempt jobs. Paying time and a half on top of 45,000 a year,(over the current threshold) will cause layoffs for some positions. Or understaffing, making work even harder; I’m all for the flexibility of employers meeting their expense needs. This proposed increase only hurts entry-level workers because the employer now has to pay more overtime, eliminating positions. It’s better to have a job that is relevant to your career, a low-wage job, than a job that is relevant to your career, a high-paying job. Relieved is right. The money for higher wages does not come from thin air.

    1. Bess*

      Not really–you only need to budget more for the position if you see the position routinely working past 40 hours per week. And in that case, they should really be making more than that threshold, it’s not really entry level, it’s more demanding.

      The last time the threshold increased, I worked in an office where a few lower-paid employees would have been impacted. The office director was concerned she couldn’t get 55-60 hours out of the employees now on that pay rate, and moved to comp time due to the budget limitations. Again, she was concerned about her ability to continue to get more hours than was really fair at their pay rate out of the employees. She wasn’t concerned about the office going bankrupt.

    2. Former Young Lady*

      The higher thresholds were put in place because greedy companies were “promoting” front line staff to “management” roles so they could work them 60-80 hours a week and continue paying them for the equivalent of 40.

      Requiring employers to pay adequate compensation for work done does not “hurt” workers, but I guess as long as low-level workers can be convinced otherwise, the greed will persist.

    3. Starbuck*

      “This new law makes it harder to get salaried entry-level jobs. ”

      Would love to know what actual evidence other than your own gut vibes that you’ve got to back this opinion up. My guess is none.

      Since we’re dealing in anecdata though, here’s mine. When I was hired at my entry level salaried role, it was a totally inappropriate designation for the level of work I was doing. There wasn’t any benefit to my career to being required to work uncompensated overtime staying late sweeping floors or stapling papers; when the threshold was raised and I got converted to hourly I not only got paid more, but also ended up doing higher-level work because management was forced to better prioritize my time.

    4. bamcheeks*

      We don’t have the exempt/non-exempt classification in the UK so I’m confused by this. Why is it good to have exempt entry-level jobs if they don’t pay as much as non-exempt ones?

    5. AnotherEmily*

      I’m an exempt employee at a nonprofit who currently makes less than the threshold that was going to go into effect Jan. 1, 2025. I started my current position this past spring after applying for many similar roles and spending lots of time comparing available salary information. I can guarantee you that your take that most exempt employees are already making more than the now-blocked threshold is wrong.

      Must be nice to not be one of the 3 million+ workers who are going to lose out on compensation because of this.

  22. Lurker*

    For anyone in New York, this doesn’t really change anything. NY already has a minimum non-exempt threshhold that’s higher than the proposed/blocked federal minimum. (I’m not sure if it’s only in NYC, or throughout the state; for some things NYC minimums are higher than the rest of the state.) I would guess there are other states where this is also the case (California?), so if you’re in one of those states make sure you’re not already misclassified.

  23. George*

    The US mainland isn’t an island it’s not surrounded by water on all sides, it’s a continent. If texas were to secede they would still border the United States.

    1. George*

      We are customers of those billionaires; customers rule, billionaires drool, and workers get the short end of both sticks.

  25. AnotherEmily*

    I work at a nonprofit. My manager informed me two weeks ago that she had the good news that I’d be getting a slight raise because of this rule and should be getting a letter from HR about it. I haven’t received a letter yet. I’m assuming the pay bump isn’t coming anymore.

    I’m pissed. I know working for a nonprofit is somewhat voluntarily working for less than you’re worth, but now I’ve not only had that fact thrown in my face, I likely won’t even get my salary bumped to the level it would have been through this when we go through the process of merit raises this fall because I am still in my first year at this org and won’t have 12 full months to be considered.

  27. Ann O'Nemity*

    Our HR was quiet about their plans for January, so those plans will be scrapped. Some employees may be disappointed if they hoped for a raise or overtime, but at least HR doesn’t have to walk-back any promises.

    I’ll be interested to see how HR handles the July changes. I don’t think they’ll lower salaries for existing employees who got a bump, but it’s possible that some folks who were moved to hourly may revert to salary.

    1. BellaStella*

      You should blame the judge and court please and the politicians judge shopping this as noted above not the State. This court also covers two other states also noted above.

      1. Kevin Sours*

        The State is a Plaintiff in this case pushing for the outcome the court reached. They don’t get a pass.

  29. Summer*

    This is so disheartening but not the least bit surprising. I’m just so rage-y over just about everything lately. From the election to the horrendous Supreme Court decisions that will have repercussions for years to come, I just don’t know how to channel this feeling into action because it feels like nothing will actually help.

  30. a commenter*

    Honestly with the Plans outlined in Project 2025 I expect overtime rules to be removed alltogether soon-ish.

    1. Former Employee*

      Thank you for mentioning what I was thinking. Project 2025 has as one of its goals that businesses should be able to “pay” employees in something other than money rather than having to pay time and a half for OT. While the suggestion seems to be comp time, I can see where it would end up being “something comparable” and left up to the employer’s discretion.

      Who wants 10 coupons to the local burger joint, tickets to a WWE event, or the blouse your boss received for her birthday (she never liked that blouse)?

      I’ve been called a “coastal snob” for saying that people are voting against their own interests, but farmers have been sounding the alarm that mass deportation will result in a shortage of people to plant and harvest crops. Wait until our plentiful, reasonably priced produce becomes a memory because undocumented workers are deported. The problem is that the people who screamed for this the loudest will be the ones complaining the loudest when a small bag of oranges costs $25.

      Worst of all, they will see zero connection between what they voted for and the result thereof.

      1. a commenter*

        This is obviously not universally applicable but if I hear “pay in something other then money” I immediately expect that the 4hrs of mandatory overtime per day get “paid” in being given a soggy pizza once a week for the whole department, instead of OT.

        This can sound a lot like doom and gloom of course, but I wouldn’t rely on continuing to be paid for overtime for my financial planning right now.

  31. Helen*

    My company was set for most salaried managers to become hourly managers. The the C-level seems excited this was struck down and the ones who were going to become hourly are excited, too. They have openly said they “work the system” and were unhappy about becoming hourly.

  32. Jujulr*

    We are still reviewing everyone who may be impacted, but in many cases, and even more so now, the state standard is what we are reviewing against.

Comments are closed.